Profoto Holding AB (publ)

Good morning, and welcome to Profotos Q4 in year-end telco. My name is Amanda Åström, and I'm head of investor relations. Today I have with me our CEO, Anders Hedebark, and our acting CFO, Linus Malmstedt. I will start off by handing over to Anders, who will start off by giving some highlights for the quarter.

Good morning, everyone. Thank you for listening in. The fourth quarter last year, sales dropped by 2% and organically 3%. Our EBIT was 52 million with an EBIT margin of 26%. However, the EBIT non-adjusted was 57 million, and Linus, you will develop on that further down in the presentation. We launched fantastic products, actually, during the quarter, the D30 and the Probe B3. And now, just after our report, we are launching L1600D next week, and we're showing it on on a trade show in London from Friday and onwards. So we see great opportunities in the market. As you all know, Profoto is the premium product in lighting for still photography. And we now are trying to enter the market of cinema lighting And our first product is the L1600D that we have worked on for a couple of years. And we have more to come towards the end of the year to actually be able to offer a full product line for the cinema lighting market. We also see actually the same product great potential in selling it to existing large still photography studios, so to existing customers. But we have also updated our product lines for still photography and those products are also well received in the market. The other thing is that we get a lot of questions about artificial intelligence. I also got that question on the Dagens Industri TV call earlier on today. Light shaping has never been more relevant now than ever before. And Profoto has been forced to adapt to technology shifts a couple of times during history. And at all times, we have thrived after those changes. And we see the same thing with the artificial intelligence. If we do the right things, we see a lot of possibilities in this area. However, we also have the general macro uncertainties that is higher interest rates and based on most probably tariffs and also consumer confidence in Asia that is affecting us and the future sale. So there is not only positive things in the market, there are also some things that needs to be handled and we need simply to work harder in order to promote our products. Coming back to product launches, this is what drives us. We are investing heavily in new products and we can see during history that launching new products is driving future sales. And as you can see in this graph, the last the period of last two years, we have launched a limited number of products and that has also affected our sales. And that is one of the things that has resulted in the decline of sales. And this year so far, we have three launches and we are now launching next week the L&D and starting to invoice and ship, which we already have started in January and in February this year. So we hope a lot for the future. So what kind of products have we launched? In this slide, I try to show that the left side of the slide are flash products, Zenon products. And we have started to update our full product portfolio. So we have launched the Pro B3, the Pro D3 and the D30 into the market. And this has offset the negative trend in the market and have balanced our sales the last quarter. And in addition to this, we are entering the LED market. The LED market is the product LED, but that kind of product is selling both to the cinema, lighting market, the film production market, as well as existing products, large studios that are doing content production in mainly steel, but also simpler or more smaller shorter videos for promotion of of products of different sorts so uh so led will will sell to a lot of different the full range of our existing and and and um and new types of products in with the enter of the the customer group of cinema lighting we expect our total addressable Market to at least double so that is a substantial and already a large Market and so we have a big hope for that And we are continuing our high investments. So last year we invested 121 million Swedish crowns in new products, which was 16% of sales. And we expect the 16 to actually go down in coming years, whereas the 121 might be on a stable level so that we will continue the high operation, be more efficient in our product development process. But we also expect that to pay off in more customer orders and higher sales. So in entering the cinema lighting market, our first product is the L1600D. And we're doing this this quarter, actually next week. And we were focusing on getting new customers that we do not have as customers today, as I earlier said. And we have... During the year, we have employed key staff in London and in Los Angeles, which is the two main markets for film production, cinema production in the world, and especially for Profoto products. And London is actually as big as California in this respect. I did myself a tour, for instance, visiting Pinewood Studios in London, and we see a great of opportunities. And gaffers that are already, gaffers are the electricians that are doing the light setting on set for film production. And the people that has tried it, we get a lot of positive feedback already. And you could follow this on Instagram, for instance, a person called Julian White. however we will not stop with the l1600d it's important for us to continue to invest to offer a full line of products into this market and during towards the end of the year we will have something that looks like a full full line of premium products for um for film production we will continue to invest in or start actually invest heavier in marketing mainly It is exhibiting on trade shows and also on the staff that I just mentioned. We will also, and we have already started this, to grow our dealer network with the dealers that are specifically targeting the film market. This is not a total revamping or a renewal of our dealer network. I would say that we will approximately increase our dealer network with around 10%. And we will do that with our existing key account manager that are already handling the dealer network around the world. But as I said, LED products will also be sold to existing appropriate customers. And we hope to see a good effect on sales towards the end of this year. So, please continue, Linus, and develop on the figures. Okay.

Thank you, Eric. Despite a fairly cautious and a continuous challenge in the market, we actually delivered a solid end of the year with both sales and EBIT on the same level as previous year. And we reported a healthy margin of around 26%. During the quarter, we also released the final payment or the liability of the earn-out related to smaller software acquisition that we did in 2023. If we look at the different geographies, we saw that we had a fairly good, solid development in the US and in Europe. But also we saw a sharp decline in Asia and especially there in China and Japan. For the full year, we had a drop of 7% on the sales. And we reported an EBIT margin decline of five percentage points. So it was a fairly challenging year, but also that we invested in product launches, as we know. Okay, and for the full year, we did not receive the financial target. However, based on what we're doing internally, and also what we investing in for the future we are very confident and committed to actually reach our financial target for the for the longer term and as you saw the board also decided to expand the dividend policy to now include the possibility to do share buybacks And for the full year 2024, we have, or the board, have proposed to deliver a dividend of two Swedish kronor per share. Okay, that's all for me.